On Friday, the USA chose to impose 25% tariffs on $50bn of Chinese products. Both countries' $34 billion tariffs are set to go into effect July 6.
If China looks to raise its tariffs on USA goods again, President Trump plans to tack additional tariffs on another US$200bn worth of goods.
In announcing the possibility of new $200 billion in tariffs, Trump mentioned that he still has an "excellent relationship" with Chinese president Xi Jinping.
The contribution of the Chinese factories in this process is estimated to be only 3.6% of the shipping price, yet US trade statistics attribute 100% of the value of imported iPhones to China and so hugely overstate the size of the U.S. China protects its companies in many sectors, especially high-tech. "This method leads to the loss of people's trust and harms the interests of people and enterprises from both China and the USA and harms the interests of the people of the entire world".
So, doesn't the administration have a point?
As the USA trade war with China looks set to escalate, Dr Tony Syme, expert in macroeconomics and worldwide finance at the University of Salford Business School, comments on what the impact might be and how it could reach much further than just the two countries involved.
Meanwhile, global stock markets fell Tuesday amidst the global concern over a tit-for-tat trade war between the United States and China.More news: Melania Trump wears ‘I really don’t care’ jacket to visit DETAINED children
American semiconductor makers saw larger losses at 2 percent or more due to their high exposure in China, according to CNBC.
"President Donald Trump's unwillingness to back down became apparent this morning, once again sinking markets into a risk-off atmosphere", Jingyi Pan of IG said in a report.
The dollar fell against the yen in early Asian trade on Tuesday after U.S. President Donald Trump's threats of more tariffs on China raised worries about an escalating trade war between the world's two largest economies.
These include major American exports to China such as soybeans, which brought in $14 billion in sales previous year and are grown in states that supported Trump during the 2016 presidential election. "We want them to understand that the tariffs have a negative impact on the U.S. oil and gas industry", he said.
United States tariffs that affect more than 800 Chinese products worth $34bn in annual trade are due to come into effect on 6 July. The strongest is probably a consumer boycott of U.S. consumer goods but it can also use restrictions on investments in China by USA companies as there are far more United States companies in China than the other way around.
Navarro said the main problem regarding China's unfair trade practices stems from its targeting of the "crown jewel" of US technology. Concerns about a trade war between the USA and China have limited the momentum behind the recovery attempt.
But, he said, "the United States will no longer be taken advantage of on trade by China and other countries in the world".